Ireland's services sector contracted in May for the fourth consecutive month and at a record decline with business confidence remaining low, the NCB/NTC purchasing managers' index showed this morning.
The headline business activity index fell to 43.9 in May from 45.2 in April, sinking further below the 50 mark separating growth from contraction and hitting a record low.
In February the survey posted its first contraction since May 2003.
"Business activity slowed markedly in May, attributed by firms to weaker economic conditions especially with regards the construction sector," said NCB chief economist Eunan King. "In general, conditions remain challenging for the service sector."
Confidence continued to soften for the second straight month in May, driven by fears about Ireland's slowing economy. It was at its lowest level since the September 11th, 2001 attacks on the United States.
NTC Economics, which compiles the survey of about 600 Irish companies, said new business fell at its sharpest pace since October 2001, hit by the slowdown in the property market.
"New business fell at the sharpest rate for 79 months and has declined at a faster pace only once in the survey," NTC said.
New export business also declined as the continued strength of the euro hampered demand abroad.